Like in the majority of the world, Pakistan has seen record-high inflation. The Consumer Price Index (CPI) for August 2022 showed a rise of 27.26% over August 2021, according to the Pakistan Bureau of Statistics. The research also noted that during this time, Urban CPI increased by 26.24% while Rural CPI increased by 28.79%.
Additionally, the cost of food has increased drastically, making it challenging for people in lower and low-income brackets to purchase meat, chicken, lentils, vegetables, and milk. The cost of Petrol and electricity has also reached to new heights.
It goes without saying that the effect of inflation on real estate has also become very clear. The cost of homes has also risen in Pakistan since there is a direct link between inflation and the housing market.
A lot of potential home buyers have switched their focus from building homes to investing in flats as the latter is better adapted to respond to inflation and offers a high ROI as a result of the rise in the cost of home construction.
Purchasing the real estate has been thought of an inflation hedge a sensible choice during an inflationary period could be to invest in real estate because home values typically rise along with prices.
IMPORTANT INFORMATION FOR REAL ESTATE BUYERS WHEN INFLATION IS PRESENT
Has the question, “Is real estate a smart investment during inflation?” ever crossed your mind? Then, absolutely. Even while it may be difficult, buying a property in such unsteady circumstances is surely not impossible. Here is a list of tips that will help you lessen the effect of inflation on real estate because AURA PROPERTIES is committed to provide its customers the best property solutions.
Choose The Property in Low Budget Areas
Investing in housing societies or upscale neighborhoods may be the top choice among people seeking to live well but doing so may prove challenging if real estate prices are increasing faster than your annual wage or other source of income.
As a result, you should think about reevaluating your options and needs if you intend to buy in real estate during an inflationary period. Consider purchasing a home in a property hotspot rather than putting an excessive amount of emphasis on high-performing neighborhoods.
These high-yield locations are frequently next to well-known performers. Since they are still in the development stage and only have a small population, their real estate values are significantly lower.
Research And Choose the Right Type of Property
Your budget can be significantly impacted by the type of home you plan to purchase. For instance, you might want to take a step back and reevaluate your goals if your budget to purchase real estate in 2022 is the same as it was two years earlier.
If buying a family home is your objective, you should look into developments outside of cities or in recently developed properties. Investing in brand-new apartment developments could also be a good idea because many developers provide buyers with appealing payment plans.
Moreover, it is important to note that the cost of luxury homes and land in desirable areas tends to increase at a faster rate than anything.
Look For Your Type of Home
The type of home you intend to purchase might have a big impact on your budget. For instance, if your budget for buying real estate in 2022 is the same as it was two years ago, you might want to take a step back and reconsider your ambitions.
If purchasing a home for your family is your goal, you should research developments outside of cities or in recently created neighborhoods. The fact that many developers offer purchasers enticing payment options makes investing in brand-new apartment projects a smart move.
Moreover, it’s crucial to understand that the price of luxury residences and prime real estate typically rises more quickly than that of less desirable places.
In conclusion, considering the link between inflation and the housing market, it can be challenging for purchasers to find the home of their dreams within their allocated budget.
But if you stick to these fundamental suggestions, you should be able to avoid the effects of inflation on real estate. Just be sure to perform your homework, comprehend the most recent real estate trends, and reevaluate your budget before signing anything.
For more information contact Aura Properties, we provide free consultancy & available to assist you regarding any Real Estate query.
RESEARCH & WRITTEN BY:
SANAH ABBASI